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BEIJING — The global aviation trade group nearly doubled its forecastof European airlines' losses this year to $1.1 billion and saidMonday the worldwide industry will scrape by with wafer thin profitmargins due to high fuel prices. U.S. and Asian carriers should make money this year, but moreairlines in Europe might follow Hungary's Malev into bankruptcy ifthe European financial crisis worsens, the International AirTransport Association said. The group called for governments to resolve a dispute over Europeancarbon charges on airlines and to avoid tax and regulatory changesit said might hamper industry growth. Global aviation should make a total profit this year of $3 billionon revenue of $631 billion -- a 0.5 per cent margin, IATA said. Thegroup represents 240 airlines that carry 84 per cent of passengersand cargo worldwide but its forecast covers the whole industry. "The industry's profitability is balancing on a knife edge," saidthe IATA's executive director, Tony Tyler. The "most immediate risk" is Europe's debt crisis, which could dragdown profit if it triggers a recession, Tyler said. He said a 1 percent drop in global airline revenue could turn the small forecastprofit into a $3 billion loss. Asian carriers should lead global profits at $2 billion this year,while U.S. carriers will make $1.4 billion, IATA said. LatinAmerican and the Middle East are expected to show profits of $400million each while African carriers lose a total of $100 million. The forecast European loss is nearly double IATA's March outlook.IATA economist Brian Pearce said that was due to Europe's financialturmoil. In addition to Malev's failure in February, smallercarriers in Germany and Spain have shut down. "We've already seen some European airlines going out of businessthis year, and there is clearly a possibility that will continue,"said Pearce. Airlines are likely to respond to tougher conditions by retiringolder aircraft to improve fuel efficiency and pursuing cross-borderpartnerships, though most countries still prohibit outrightmergers, Pearce said. The latest outlook is based on a forecast that oil prices willaverage $110 a barrel this year. IATA says fuel accounts for 33 percent of carriers' costs, up from 13-14 per cent a decade ago. The global profit forecast represents a decline of more than 50 percent from last year's $7.9 billion. That was down by a similarmargin from 2010's $15.8 billion profit. Also Monday, IATA appealed to governments to head off a mountingconflict over European carbon charges on airlines by negotiating aglobal system to regulate the industry's emissions ofclimate-changing gases. China, the United States, India, Russia and others oppose theEuropean charges, which took effect Jan. 1 and require carriers tobuy permits to emit carbon. China and India have prohibited theirairlines from cooperating and Beijing has blocked purchases ofEuropean aircraft by its carriers, stirring fears of furthereconomic retaliation. "We strongly oppose this unilateral action," said Wang Changshun,chairman of Air China Ltd., one of China's three main state-ownedcarriers, at a news conference with Tyler. Aviation accounts for 3 percent of total carbon emissions but isthe fastest-growing source. Talks on a global system have begun in the International CivilAviation Organization and the European Union has said it would bewilling to reconsider its system if an agreement is reached. "It should be a global system," said IATA chairman Peter Hartman,president of Dutch carrier KLM NV, at the news conference. "We are not opposing (regulation of carbon emissions), but we areopposing that they try to force other continents under theirlegislation," Hartman said. The group appealed to governments to repeal taxes such as a newBritish passenger charge that it said hamper industry growth. Itcalled for action on other issues such as delays in expandingairport capacity in Sydney and India's business capital, Mumbai. "Aviation should be seen by governments as a source of economicgrowth, but not as a cash cow," Tyler said. "Using it wisely willdeliver benefits throughout the economy.". We are high quality suppliers, our products such as Rotary Drum Dryer Manufacturer , Fluid Bed Dryer Manufacturer for oversee buyer. To know more, please visits Air Stream Dryer.
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